Huawei: The Human Resource Component of a Modern Chinese

UNCLAS GUANGZHOU 032401

SIPDIS

SIPDIS

STATE PASS USTR
USPACOM FOR FPA

E.O. 12958: N/A
TAGS: ELAB ECON ETRD EINV CH

SUBJECT: Huawei: The Human Resource Component of a Modern Chinese
Company


The Face of China's Future
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1. (U) When you walk around the Huawei "campus," you are staring
into China's future in more ways than one. Huawei, one of China's
brightest lights in terms of telephone service (fixed, mobile,
routers and connectors) and one of the country's most
internationally-oriented firms, is also a pioneering company in
terms of human resources, working closely with Mercer management
consultants to develop a well rounded, educated and productive work
force.

Training: In depth and Continuous
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2. (U) During a briefing for the Consul General and consulate
econoff on December 13, Huawei's Senior Vice President for Global
Sales, Ding Shaohua, affirmed the old adage that success is measured
by the quality of people you have. And the first step toward that
success is recruitment. Huawei recruits primarily from Beijing,
Qinghua, Zhejiang and Wuhan Universities; it hardly recruits at all
in Guangdong province, he said, noting that graduates of schools
here are clearly not in the same league as graduates elsewhere.
Depending on the type of job they perform, the new employees, once
on board, receive 1-3 months of training at Huawei University (which
Mr. Ding proudly termed the equivalent of Motorola University in
Beijing) and then receive continuous in-service training, sometimes
using computers for self study, sometimes actually being released
from work to attend classroom sessions. If at the end of their
training, they decide to move on elsewhere, they are not required to
repay the company for the costs incurred.


3. (U) The new hires, mostly single, are also provided with a one
bedroom apartment on the 1.3 kilometer campus, a food subsidy and
medical insurance; when they marry, they are assisted in finding
housing off-campus. One fly in the ointment: it seems that managers
get overtime but shop floor workers may receive it only an irregular
basis.

Employees May be Encouraged to Leave - But Not Fired
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4. (U) Huawei's employee force in Shenzhen - 25,000 strong out of
55,000 globally - are constantly being evaluated, as many as 3-4
times a year. Managers use an alphabet scale - A, B, C, D - and
those who receive D's four or five times in a row are closely
counseled and, in many instances, encouraged to find other
employment. People are rarely fired, however, and the attrition
rate is no more than three percent annually. Those who leave
voluntarily may be asked to sign a "no compete" agreement; the
likelihood is that they will form a company that does business as a
Huawei affiliate.

Comparison to ZTE's Management Style
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5. (U) Service/employment in Huawei, Mr. Ding told us, is a
lifetime career commitment on the part of both employees and
managers. Speaking of managers, Ding told us that the number of
managers in Huawei is purposefully kept small; that way there is
less office politicking and more effort directed at innovation.
This he pointed out is unlike ZTE, where the operating style is less
collegial and more bureaucratic, perhaps a reflection of ZTE's
government connections and focus on the domestic market and Huawei's
looser corporate management style, greater private investment, and
focus on the international market (which today accounts for 68
percent of its sales). Huawei employees also have a more polished,
open approach to work and play, Mr. Ding told us and you can see
that in the manner in which Huawei employees interact with their
customers as well as their demeanor in engaging one another in
private conversation.

GOLDBERG